Published on: April 24, 2020
On Monday April 20, 2020, Governor Baker signed into law House Bill H4647, which places an immediate moratorium on Massachusetts evictions and foreclosures during the COVID-19 State of Emergency. The Moratorium will expire 120 days after the date it was enacted (i.e. August 20, 2020) or 45 days after the Governor’s State of Emergency has been lifted, whichever is sooner.
Non-Essential Evictions: The Eviction Moratorium prohibits Landlords from pursuing any “Non-Essential Evictions.” According to the new law, “Non-Essential Evictions” are defined as:
- Evictions for non-payment of rent
- Evictions resulting from foreclosures
- No Fault and/or No Cause Evictions (Termination of Tenancies at Will and/or Non-Renewal of Tenancies)
- Evictions for cause that do not involve any of the following:
- Criminal activity that impacts the health and safety of fellow residents, health care workers, emergency personnel, others persons lawfully on the property (i.e. property management and maintenance staff) as well as the general public.
- Lease violations that impacts the health and safety of fellow residents, health care workers, emergency personnel, others persons lawfully on the property (i.e. property management and maintenance staff) as well as the general public.
Accordingly, the Eviction Moratorium does not apply to evictions that are the result of criminal activity and/or lease violations that impact the health and safety of others. Landlords preserve their right to pursue these evictions.
Landlord Prohibitions: As a result, the Eviction Moratorium prohibits Landlords from both terminating tenancies and/or pursuing summary process (eviction) cases for any “Non-Essential Eviction” because the new law bans:
- Sending notices to quit
- Non-renewing tenancies
- Terminating tenancies at will
- Requesting/demanding that a Tenant vacate the premises
- Serving summary process (eviction) complaints
- Filing summary process (eviction) complaints with any Massachusetts Court
In order to enforce these restrictions, under the new law, all Massachusetts Courts are prohibited from:
- Accepting filings for any new summary process (eviction) cases
- Scheduling any court dates for summary process (eviction) cases
- Entering default judgments
- Issuing Executions (court order to remove Tenants and their belongings from the premises)
- Denying, upon the request from Tenant, a stay of any Execution
Despite the fact that many Landlords terminated these “Non-Essential Evictions” by issuing their Tenants a Notice to Quit before this new law was enacted, under the Eviction Moratorium, Landlords are now prohibited from pursuing the eviction in court if Tenants fail to satisfy the outstanding rental balance owed and/or fail to vacate the premises. This is true if even if the tenancy was terminated prior to the issuance of the Governor’s State of Emergency. Further, the Eviction Moratorium even applies to Landlords who have obtained a judgment against the Tenant because the new law restricts a Landlord’s ability to levy Executions and grants Tenants an automatic stay upon application to the Court.
However, nothing shall relieve a Tenant from their obligation to pay rent or restrict a Landlord’s ability to collect rent. Accordingly, Landlords are fully entitled to collect the entire outstanding balance owed the moment the Moratorium has been lifted.
Late Fees: The new law provides that Landlords cannot impose late fees for non-payment of rent nor are Landlords permitted to report a Tenant to any credit reporting agency if the Tenant provides notice to his/her Landlord that the non-payment was due to financial impacts caused by the COVID-19 pandemic.
Last Month’s Rent: Landlords who collected last month’s rent in advance are prohibited from utilizing these funds to account for any non-payment of rent. However, Landlords can use last month’s rent to pay for:
- Mortgage payments
- Repairs/required property upkeep
Landlords who utilize last month’s rent for any of these reasons must notify the Tenant in writing that:
- The Landlord used these funds before the last month of the tenancy
- The Landlord remains obligated to apply these funds to last month’s rent
- The Tenant is still entitled to the interest that would have accrued
Thus, while Landlords can use these funds to cover expenses, these funds must still be applied to last month’s rent and the Tenant is entitled to the full amount of interest that would have accrued on last month’s rent had these funds not been accessed.
Commercial Tenancies for Small Businesses: In addition to residential tenancies, the new law also places an Eviction Moratorium on commercial tenancies that impact any “Small Business Premises Unit” which is defined as any premises occupied by a Tenant for commercial purposes that:
- Operates multi-state
- Operates multi-nationally
- Publicly traded
- Has more than 150 employees
Thus, the Eviction Moratorium does not apply to tenancies occupied by businesses that operate on a national and global scale. Landlords for these larger commercial Tenants still have the right to terminate tenancies, commence summary process (eviction) actions, and demand that these Tenants vacate the premises. However, the new law protects commercial Tenants that are considered a “Small Business Premises Unit” as these same eviction prohibitions and restrictions apply to Landlords for smaller, commercial tenancies as well.
In addition to the Eviction Moratorium, this new law also places restrictions on Mortgagees and/or other creditors’ ability to foreclose on residential property. Specifically, Mortgagee and other creditors shall not:
- Cause notice of a foreclosure sale to be published;
- Exercise a power of sale
- Exercise a right of entry
- Initiate a judicial or non-judicial foreclosure process
- File a complaint to determine the military status of a mortgagor under the Federal Servicemember’s Civil Relief Act
However, these foreclosure restrictions do not apply to residential property that is either vacant or abandoned.
Please contact Marcus, Errico, Emmer & Brooks P.C. if you have any questions regarding how the Eviction and Foreclosure Moratorium may impact your property and the steps to take in order to preserve your rights.